Home health care advocates on Wednesday lauded the government’s investigation of a Rockwall doctor and six associates accused of masterminding the largest medical billing fraud scheme of its kind in the country.

“It is critical that scarce Medicare and Medicaid funds are protected from fraud and abuse schemes,” Anita Bradberry, executive director of the Texas Association for Home Care & Hospice, said about the alleged $375 million swindle.

“We hope that this high-visibility case will serve as a warning that efforts to defraud the system will not be tolerated and that all providers will adopt effective compliance plans.”

They were arrested Tuesday and charged with signing up thousands of homeless people for home health care services they did not need and then billing the government for it. Authorities said it is the largest alleged home health fraud ever by a single physician.

“Absolutely shocked,” said Valerie Nunnery, a neighbor of Roy’s in Rockwall. She said after federal agents last summer served search warrants on the doctor’s home, which sits near Lake Ray Hubbard and is valued at $363,000, she and others in the area thought it was a mistake.

“I absolutely couldn’t believe it was as bad as it was,” she said. “He was just a very nice person.”

Roy, a Canadian citizen, has not entered a plea. He was ordered held pending trial by a federal judge. He has had a long history of misconduct, and has been linked to one death and the loss of sexual function of another person. The Texas Medical Board, however, has allowed Roy to keep his medical license.

Regulators on Tuesday also suspended payments to 78 local home health providers with connections to Roy and his firm, Medistat, in DeSoto.

Prosecutors estimate that Roy has as much as $19 million in illegal proceeds from the swindle hidden under false names in bank accounts here and overseas. They have located about $4 million, and are also seeking to seize two of his sailboats and several automobiles.

According to the indictment, Roy and the others, including owners of home health companies, paid recruiters about $50 for every person they signed up for government-funded home health care that many never received, nor needed.

Recruiters went door to door, and some targeted downtown Dallas homeless shelters, bribing prospective “patients” with cash, food stamps and groceries for their signatures, authorities say.

Investigators believe Roy signed up 11,000 people since 2006.

Roy’s lawyer, Patrick McLain, disputes the charges.

The director of The Bridge, one of the shelters allegedly targeted by Roy and his associates, spoke out about the investigation Wednesday.

“In 2010, we became aware of suspicious activities involving the medical care of our guests unrelated to the on-site health care services we provide,” said president and CEO Jay Dunn.

“As a result, our services team collaborated with local authorities to investigate and respond. Those actions were aided by federal investigations, with which we cooperated. Those investigations have led to the indictment of seven individuals for fraud.”

According to the indictment, Charity Eleda, a 51-year-old nurse from Rowlett, signed up multiple people for fraudulent benefits at the shelter. When staff kicked her out, she allegedly kept working with recruiters, signing up “patients” at a nearby park bench and church.

Eleda was arrested Tuesday along with the other defendants. She has not entered a plea. Cyprian Akamnonu, 63, and Patricia Akamnonu, 48, both of Cedar Hill and owners of Ultimate Care Home Health Services, were ordered held Tuesday because they are possible flight risks. Neither have entered pleas.

Cynthia Stiger, 49, of Dallas, was among those arrested Tuesday. She pleaded not guilty Tuesday to conspiracy to commit health care fraud. She co-owned Apple of Your Eye Health Care Services with Wilbert James Veasey Jr., also charged in the case.

Stiger’s attorney Jeffrey Grass said his client dissolved the partnership after she discovered Veasey “doing things that were making her uncomfortable, as far as ethical considerations.” He did not elaborate.

Grass said that after Veasey left the company, the Texas Department of Aging and Disability Services inspected Stiger’s business. “On three occasions, she passed an audit of all Medicare billing that she has done,” Grass said.

Veasey, 60, of Dallas, pleaded not guilty Tuesday. Heath Hyde, his attorney, did not comment when reached Wednesday.

Teri Sivils, 44, of Midlothian, Roy’s former office manager, also pleaded not guilty Tuesday, said her attorney William McMurrey, a former federal health care fraud prosecutor.

“She’s very disappointed and very surprised by being a named defendant with her former employer, Dr. Roy,” he said.

He said that of all the boats, cars, real estate and bank accounts sought by the government and cataloged in the indictment, none belong to Sivils. “If the government had been doing its job and following the money, Ms. Sivils would not have been indicted.”

Staff writer Lindsey Bever contributed to this report.

UPDATE: Detention hearings

Seven people were arrested in a $375 million Medicare and Medicaid fraud scheme.

Dr. Jacques Roy has not entered a plea. He is in custody, and his detention hearing is set for 2 p.m. Monday.

Charity Eleda, 51-year-old nurse from Rowlett who allegedly signed up homeless people for fraudulent services at The Bridge in Dallas, has not entered a plea. She is in custody, and her detention hearing is set for 2 p.m. Friday.

Cyprian Akamnonu, 63, and Patricia Akamnonu, 48, both of Cedar Hill and owners of Ultimate Care Home Health Services, have not entered pleas. They are in custody, and their detention hearings are set for Friday.

Cynthia Stiger, 49, of Dallas, who co-owned Apple of Your Eye Health Care Services, has pleaded not guilty. She has been released pending trial.

Wilbert James Veasey Jr. has pleaded not guilty. He has been released pending trial.

Teri Sivils, Roy’s former office manager, pleaded not guilty. She has been released pending trial.

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